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China’s Ministry of Environmental Protection’s increased authority over climate change and pollution control issues indicates a greater enforcement role for central government.

By Paul A. Davies and Andrew Westgate

The Chinese government has announced a major reorganization of China’s ministries that comprise the Chinese central government at a session of the 13th National People’s Congress in Beijing. The reorganization, which will reduce the number of ministries from 34 to 26, is intended to streamline and strengthen central government’s role in accordance with the principle of “comprehensively deepening reforms,” a key component of President Xi Jinping’s political program.

The Ministry of Environmental Protection (MEP) will be reconstituted as the Ministry of Ecology and Environment (MEE) as part of the reorganization. The MEE’s authority will expand to consolidate pollution-related responsibilities currently allocated among several other ministries, as well as assuming responsibility for climate change policy from the National Development and Reform Commission, a powerful economic planning agency which developed the national emissions trading system launched in late 2017. Specifically, MEE will expand its authority with respect to supervision and prevention of groundwater pollution, wastewater emission control, protection of rivers, non-point source agricultural runoff, protection of oceanic environments, environmental oversight for China’s massive South-North Water Transfer Project, and responsibility for climate change and emissions reduction policies.

By Paul Davies and Andrew Westgate

Earlier this month, during a round of surprise inspections, Deputy Minister of the Ministry of Environmental Protection Zhao Yangmin publicly shamed the city officials of Langfang, a city in Hebei province, for failing to take action after a severe pollution warning was issued on April 2, 2017.  Deputy Minister Zhao also ordered a production halt at companies in Langfang which had failed to meet emissions control requirements or had submitted falsified emissions data, blaming “some local governments that do not take emergency response seriously.”

The inspection was part of a 28-city inspection campaign by the Ministry of Environmental Protection, the largest the Ministry has ever undertaken. The inspections involve 5,600 inspectors and will run through March of 2018, focusing on the provinces surrounding Beijing and Tianjin, where some of China’s worst air pollution is found.  Officials determined to be lax in their enforcement efforts could receive lower ratings in the personnel evaluation system used by the government; for serious offense, officials could be demoted, fired, or in some cases even subject to criminal charges.

By Paul Davies and Andrew Westgate

On Sunday, China Central Television (CCTV), the country’s state-run broadcast network, aired a report claiming that nearly 500 students apparently developed illnesses (including leukemia) at a school built on contaminated land. Of the 2,451 students that attend Changzhou Foreign Languages School in Jiangsu Province, 493 (one in five) were diagnosed with diseases including dermatitis, bronchitis, white blood cell deficiencies, and in a few cases, lymphoma or leukemia. The school, which opened last year, is located one block from a plot that was home to three chemical plants which were relocated in 2010. An investigative report from the financial journal Caixin quoted a former employee of one of the companies stating that it had buried toxic waste at the site, and regularly dumped waste into a river that flows into the Yangtze. Samples taken in 2012 show concentrations of chlorobenzene (a component of herbicides) 94,799 times greater than national groundwater standards, in addition to contamination with other toxic chemicals and heavy metals.

The report has received considerable attention on the internet, with a “contaminated school” discussion thread on social media chat site Weibo attracting 30 million views and 76,000 comments within a day after the report aired on CCTV. Reports state that parents across the country are concerned that such incidents could happen anywhere in China. In response to the report, the Ministry of Environmental Protection stated that it “attached great importance to the matter” and the Changzhou city government stated that it has “zero tolerance” for pollution, and will be taking prompt action.

Though overshadowed for many years by air and water issues, soil pollution has attracted increasing focus in China, particularly following a separate Caixin investigation which revealed that rice grown in Hunan, China’s top rice-producing province, was contaminated with cadmium. In 2014, a government survey conducted between 2006 and 2011 was released showing that one fifth of China’s agricultural land is contaminated. Lan Hong, a professor at Renmin University’s School of Environment and Natural Resources observed that “China has entered its Love Canal era.”

By Paul Davies and Andrew Westgate

Despite a more challenging business environment, China remains a key market for multinationals. China’s economic growth rate might have slowed, but its GDP is still rising at a faster rate than most other countries.

As China enters the next phase of its economic growth, the government continues to implement reforms designed to restructure the economy – ending the reliance on exports and turning its attention to the significant consumer markets. Beijing and Shanghai are home to the offices and manufacturing facilities of more than 400 Fortune 500 companies. With much invested in China, multinationals are facing increased competition, rising costs and more stringent regulatory compliance.